A different pace of life

Stand_up_8

2021rdsunshine said:

Hi! I know you mentioned you don’t want to dip into your savings but I would pay the 2 MBNA cards from savings before Nov, then use the monthly money that you are paying on them to top up payments on the Barclaycard and hopefully get it full paid by the time the 0% finishes. This way you would get rid of credit cards debts pretty quick 
xx

Hi there

Paying off the MBNA card before both deals start to accrue interest is entirely possible. I don't know what stops me doing that, except that I feel much safer in life knowing I have £5k in the bank. And if things went wrong, I'd just stop paying the cards and still have cash. I feel pretty fragile in life, generally, and this helps. 

It would take £138 per month from now until next July to make sure the Barclaycard is cleared on time. That probably won't happen. The other card needs to take priority as it's coming off it's deal sooner. It will cost £58 to move £2k from the <BNA onto the Barclaycard, of the same deal is available to me as now.  

I honestly just don't know what I should be doing. 

Stand_up_8

elsien said:

Stand_up_8 said:

Hi elsien

Thanks for your helpful comments. You are exactly right - I have had a change in circumstances that unsettled everything. I am now wondering if the move was a good idea. Time will tell. 

I have a business bank account and all invoices are paid into that. The professional fee will come out of there, but will reduce my wage by that amount that month. It will be tax free so come April I'll have a slightly lower tax bill but other than that, it's all just my money, organised in a particular way. You have given me an idea about building a separate savings pot linked to my business account. That would be a good goal.   

The excess £300 monthly has been used to cover things like MOT, etc, as I mentioned before. When a bill is bigger than expected, I have used my EF then paid myself back. Recently, I haven't been able to pay myself back. It does seem like it's time to start building those separate pots again to cover car expenses, clothing, etc. You've reminded me that I used to have those in place but they got emptied when I made the move. 

Some of what I struggle with is the actual practicality of it all. In the past, I used envelope stuffing. I had a cute little file with plastic wallets and put cash in there every month. However, it got quite annoying when I wanted to buy a gift online, or if I wanted to buy something but had forgotten to bring the wallet. I know this sounds petty but it is an area I struggle with. Recording things as I do helps keep me roughly on track but it has never been easy. Maybe I need to open a couple of savings accounts for sinking funds. I don't know.  

I do that as well. I like my little envelopes although in this electronic age people tend to look at me as if I am mad!
A couple of ways round it - an account where you have have separate virtual "pots" and move things around that way. Doesn't work for me but it does for a lot of people.
I have separate easy access savings accounts for the bigger things which I put a set amount into each month - mine are currently holidays, car (includes road tax, servicing etc) and house maintenance because my house is a bit of a money pit.
With the envelope thing eg my birthday or social funds I still buy things online etc but then pay myself back out of the envelopes. I have a tin for money that needs to go back into the main account so it's my "don't touch this, it has to go back" tin. I know that would be too much of a faff for a lot of people but it's about knowing what you have, not overspending and then making sure the money goes back where it needs to go. If that makes sense. 
If there isn't enough in my envelope then lunch out (or whatever) has to wait. 

Sometimes it's about playing around with the different systems and balancing the time it takes with how your brain works. 

People thought I had gone mad too when I started with the little envelopes.  But it worked for some sinking funds, just not for others. I possibly need a combination of little envelopes and online savings accounts. It's been helpful talking about it on here cos now I'm wondering why it all fell by the wayside. Typical me to not manage to stay on track. I need to be realistic about what I'm saving for at the moment. A holiday is out of the question until all of this has settled down and I know I'm solvent. 
                                                   

elsien

Stand_up_8 said:

2021rdsunshine said:

Hi! I know you mentioned you don’t want to dip into your savings but I would pay the 2 MBNA cards from savings before Nov, then use the monthly money that you are paying on them to top up payments on the Barclaycard and hopefully get it full paid by the time the 0% finishes. This way you would get rid of credit cards debts pretty quick 
xx

Hi there

Paying off the MBNA card before both deals start to accrue interest is entirely possible. I don't know what stops me doing that, except that I feel much safer in life knowing I have £5k in the bank. And if things went wrong, I'd just stop paying the cards and still have cash. I feel pretty fragile in life, generally, and this helps. 

It would take £138 per month from now until next July to make sure the Barclaycard is cleared on time. That probably won't happen. The other card needs to take priority as it's coming off it's deal sooner. It will cost £58 to move £2k from the <BNA onto the Barclaycard, of the same deal is available to me as now.  

I honestly just don't know what I should be doing. 

If you need that psychological buffer while you get back on track then keep it. Sometimes the emotional side is just as important as the numbers so there is no "should" because it's what work for you to help you to move things forwards. 

Stand_up_8

I just found my list of previous sinking funds. They were: 

• Car (obvious one)
• Gifts (birthdays and Christmas)
• House & Garden
• Dentist
• Self-care (haircuts, clothes, anything like that)
• Holiday
• New laptop (cos my old one may die any day)
• Miscellaneous (a wee pot for anything that doesn't fall into the other categories)
• Professional expenses

I don't need all of those now. I'm not saving for a holiday, I don't need miscellaneous, and I now have an NHS dentist so it never costs that much. I need to add a sinking fund for professional expenses. That'll be 6 in total. The sensible thing would be to have them all in an online savings account so I just opened one. It opened instantly so that was useful. 

Sarahwithlove

What sort of interest are you paying on your car loan? Will paying it off save you money? Would it wipe all your savings? It would leave you with the car payments to be put away each month for a Sinking fund and top your emergency fund back up. Also if you do lose your job reducing your expenditure would be a good move. I know having savings helps mentally but in some ways that's what an emergency fund is for. 

Stand_up_8

Hi Sarahwithlove

Thanks for your comments. It's always useful to have a think about every possibility. The car is on HP. I'm fairly sure the settlement amount would be a bit less than continuing to pay monthly, but not much. I did request the settlement amount a few times last year and it just didn't seem worth it. I love the car but I'd never do anything like that again. It was not a sole decision - my circumstances were different back then. We live and learn. I had a quick look at your diary. It seems you prefer keeping a savings pot, too, rather than paying it all off debt. It does make you feel better, right? We live in precarious times. 

I don't really feel at risk of losing my job now. I'm able to work from home and even if my current employment came to an end, I could increase the self-employment until I found something else. Mostly I just need to build my confidence.

 

Stand_up_8

I have an idea for small overpayments every week. I occasionally crave sweets and chocolate. I don't keep any at home because I'd just eat it all in one sitting so when this happens, I head out to the shop and spend a few pounds on treats plus other things that I could do without. Today, I took that amount and paid it off a credit card and tried to distract myself instead. It worked, and is better for my health and better for my credit card balance. £6.19 off MBNA.

MBNA 1 £1,647.63 - £6.19 = £1,641.44 
Maybe my first goal can be to get this down to under £1k before I need to transfer it in November. I don't know if this is realistic but I can try. 

I'm making a list of things to do that I enjoy that are free. My landlady popped round with some paint to touch up the bathroom, bedroom and skirtings, so I can get busy with DIY. I also have some gardening to be getting on with. There's lots to be done. I do enjoy a lunch out but it is just so expensive lately. I've tried to look for cheaper places to eat but they just don't exist. 

Stand_up_8

My wages come in throughout the month with 5 different paydays plus random invoices that usually get paid in the first week. This is probably why cashflow is tricky - I may have been using my EF to smooth that over.

So, I need to increase sinking funds to anticipate the big expenses. Also, increase my EF again and not touch it unless it's an actual emergency. Also, build a buffer in my current account so I can start the month with a full wage in there.   

With all this saving going on, I'm not sure how I'll get my MBNA card down to £1k before December so that's another difficulty. 

3 month plan

• Save enough to cover professional fees and upcoming work on the car
• Increase my EF
• Start saving buffer in current account
• Reduce MBNA 1 to £1k

I enjoy a challenge. 

elsien

Sounds like a plan.
Good luck.  

Stand_up_8

I got a wage today so I have paid my rent, put £75 into my sinking funds pot, sent £50 to my EF, kept £40 to cover food and spends for the next week, and made a small payment of £8.25 to MBNA. 

MBNA 1 £1,641.44 - £8.25 = £1,633.19